Broadband Portion of Infrastructure Bill: A Big Win for Cable & Wireless Industries

On November 5, 2021, the U.S. House of Representatives approved the?Biden administration’s $1.2 trillion Infrastructure Investment and Jobs Act (Infrastructure Bill), which includes $65 billion for broadband access to improve internet services for rural areas, low-income families and tribal communities. Most of the money would be made available through grants to states. The Infrastructure Bill, which was signed into law by President Biden on November 15, 2021, will greatly benefit cable and wireless companies.

A large portion of the expenditure, $42.45 billion, will be overseen by the Commerce Department’s National Telecommunications and Information Administration (NTIA), which is responsible for making grants to the states. Another significant allotment, $14.2 billion, will go to the Federal Communications Commission (FCC) to establish an Affordable Connectivity Program, an extension and revision of the Emergency Broadband Benefit that provides $30 monthly broadband subsidies for eligible households.

The rest of the package includes $2.75 billion for a Digital Equity Program to ensure that “individuals and communities have the information technology capacity that is needed for full participation in the society and economy of the United States”; $2 billion for RUS ReConnect; $2 billion for the Tribal Broadband Program; $1 billion for a new middle-mile program overseen by NTIA; and $600 million for Private Activity Bonds for broadband deployments. The infrastructure Bill also highlights funding for Wi-Fi networks in apartment buildings.

The following are high-level summaries of the Infrastructure Bill’s Broadband Provisions:

Grants to the States

NTIA will administer $42.5 billion grants to the states, which will competitively award grants to support broadband infrastructure deployment, mapping, and adoption. NTIA is required to issue a Notice of Funding Opportunity (NOFA) for this Program within 180 days, which will establish a process for states to apply for funding by submitting a letter of intent (LOI), as well as an Initial Proposal and a Final Proposal.

Funding Categories

The NTIA program will allocate three categories of funding to individual states.

1. Minimum Allotment: The first funding category consists of a minimum allotment of $100 million to each state, with an additional $100 million in funding to be allocated equally among certain U.S. territories.
2. High-Cost Funding: The second category ($4.25 billion) would be allocated for broadband deployment projects based on unserved locations in high‐cost areas in each state, as determined by NTIA based on factors such as poor economic levels in a given area, low population density, whether an area is far removed from well-served, urban areas.
3. Unserved Funding: The third category of funding (approximately $32.2 billion) would be allocated for broadband deployment based on any unserved locations in each state.

Funding Allocations Based on Broadband Maps

On or after publication of the broadband maps by the FCC pursuant to the recently enacted Broadband DATA Act, NTIA must allocate the High Cost Funding and the Unserved Funding to states. The main provisions of the Broadband DATA Act:

• Require the FCC to collect granular service availability data from wired, fixed wireless, and satellite broadband providers.
• Set strong?parameters for service availability data collected from mobile broadband providers to ensure accuracy.
• Permit the FCC to consider whether to collect verified coverage data from state, local, and tribal governments, as well as from other entities.
• Create a process for consumers; state, local, and tribal governments; and other groups to challenge FCC maps with their own data, and require the FCC to determine how to structure that process without making it overly burdensome on challengers.
• Establish a crowdsourcing process that will allow the public to participate in data collection.
• Strengthen enforcement against providers that knowingly or recklessly submit materially inaccurate broadband data.
• Require the FCC to use the newly-created maps when making new awards of broadband funding.

Once a state submits a proposal or LOI, NTIA will allocate High-Cost Funding and Unserved Funding to states based on two formulas defined in the bill, which compare the number of high cost and unserved areas in a given state against the national average. The Program requires substantial coordination by the state with local and regional entities.

Use of Funds

Once a state completes the NTIA process, it may use its funds to “competitively award” subgrants to eligible entities. Eligible entities include cooperatives, nonprofit organizations, public‐private partnerships, private companies, public or private utilities, public utility districts, or local governments.

Broadband Providers May Challenge Fund Allocations

The bill establishes a challenging process that allows broadband service providers to challenge determinations made by states as to the eligibility of entities for grant funds and whether particular locations are deemed unserved or underserved. The challenge process includes deadlines and public notice requirements that states must meet in making these determinations, reserving to NTIA the final authority to modify or reverse such eligibility determinations.

Reporting Requirements

The bill establishes periodic reporting requirements for states and subgrantees regarding the use of grant funds, information on the types of customers being served, and broadband speeds, among other things listed at length in the bill.

Enabling Middle Mile Broadband Infrastructure

The Infrastructure Bill also establishes a $1 billion grant program at NTIA for the construction, improvement, or acquisition of middle mile infrastructure on a technology-neutral, competitive basis to eligible entities. NTIA is instructed to establish an application process for middle mile grants to eligible entities that meet certain conditions, including fiscally sustainable middle mile strategies, nondiscrimination, supplemental investments, or conditions relating to national security. The bill prioritizes funding for middle mile infrastructure to serve households in unserved areas and requires that build out be completed within five years of the grant being made.

Digital Equity Act Competitive Grant Programs

The Infrastructure Bill also includes $2.75 billion in funding under the Digital Equity Act of 2021 to create two distinct grant programs to be administered by the Department of Commerce: a Capacity Grant Program, directed toward broader state efforts to achieve digital equity and inclusion; and a $250 million per year Competitive Grant Program focused more narrowly on covered populations, such as senior citizens, veterans, minorities, and individuals with a language barrier. Recipients of Competitive Grant Program funding must generally expend the funds within four years of the award.

Broadband Affordability

The bill also makes the FCC’s Emergency Broadband Benefit (EBB) Program permanent, renaming it the “Affordable Connectivity Program,” and allocating it $14.2 billion. The program provides a monthly subsidy for low-income families to purchase any internet service of their choosing without submitting to credit checks, with a higher subsidy for qualifying families in high cost areas, as well as expanding the program to include households participating in the federal Women, Infants, and Children (WIC) program. It also requires participating providers to carry out public awareness campaigns to promote the program.

Consumer Protection

The bill requires the FCC to establish a consumer complaint process and issue regular public reports about complaints it receives and permits the FCC to conduct outreach to encourage eligible households to enroll. The bill also requires the FCC to establish rules to protect customers who enroll in the program from upselling or downselling by providers, among other practices that undermine the program’s purpose. Within one year of enactment, the FCC must issue final rules regarding annual data collection relating to price and subscription rates for internet service and make such data publicly available. Additionally, the bill requires the FCC to establish rules requiring providers to display broadband consumer labels, disclosing information to consumers regarding their internet service plans. Finally, the Infrastructure Bill requires the FCC to adopt rules within two years of the bill’s enactment to address discrimination in access to broadband internet service on the basis of income, race, ethnicity, color, religion, or national origin.

If any part of this Advisory triggers a particular interest for you or your company, please feel free to contact Ronald E. Quirk at ?[email protected]

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